Plenty of winners and losers in new farm bill

Soybean and catfish farmers, dairy food manufacturers, U.S. cattlemen and the organic food industry all counted themselves among the big winners this week, following the release of the farm bill conference report.

Much less pleased are meat processors, champions of the food stamp program and Rep. Steve King (R-Iowa).

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The farm bill’s four principal negotiators — Reps. Frank Lucas (R-Okla.) and Collin Peterson (D-Minn.) and Sens. Debbie Stabenow (D-Mich.) and Thad Cochran (R-Miss.) — completed what some were starting to think might be an impossible task, potentially ending nearly two years of partisan bickering, when they submitted a unified, five-year farm bill for review by the full House and Senate Monday night.

The roughly $500 billion agreement — which came in just under 1,000 pages — would eliminate a 20-year-old direct payment subsidy program that paid out roughly $5 billion a year to farmers regardless of need and sinks much of those savings into beefed-up crop insurance and countercyclical subsidy programs. It would cut spending on food stamps by billions of dollars.

Speaker John Boehner (R-Ohio) likes it and is encouraging his colleagues to support the agreement.

“The measure will not only save taxpayers approximately $23 billion, it also includes important reforms to both farm and food stamp programs,” he said. “While I hoped many of these reforms would go further, the status quo is simply unacceptable. I have voted against the last two farm bills because, in my view, they made farm and food stamp policy worse rather than better. This legislation, however, is worthy of the House’s support.”

Boehner’s support could come in handy, as the nearly 1,000-page bill, which took more than two years to complete, will likely be up for a vote in the House on Wednesday. It is expected to go before the Senate next week.

The bill also has an important champion in the Senate.

“Today’s bipartisan agreement brings us closer than ever to enacting a five-year farm bill that saves taxpayers billions, eliminates unnecessary subsidies, and helps farmers and business owners create jobs,” Stabenow said. “This bill proves that by working across party lines we can save taxpayer money while at the same time strengthening efforts helping to create jobs.”

The new farm bill would provide farmers a choice between price-based and revenue-based subsidies. It promises to keep farmers from planting crops to just chase more subsidy checks by basing subsidies on farmers’ “base acres.”

The House originally passed a farm bill with subsidies tied only to “planted acres,” but the conference committee negotiators gave in to concerns that the approach would tempt farmers to make planting decisions based on what subsidies they can get rather than market forces.

Count the American Soybean Association among the groups pleased with the approach. In a statement, ASA said it “supports the bill, which provides for multiple soybean farmer priorities, most notably a flexible farm safety net that includes a choice between price-based and revenue-based risk management tools and maintains the decoupling of payments under both programs from current planted acreage.”

Other important changes:

$9 billion in food stamp cuts

The farm bill deal is chock full of provisions to reduce food stamp fraud, cutting roughly $9 billion from the program over 10 years — more than twice the cuts originally sought in the Democrat-controlled Senate farm bill.

But it avoids the far larger $40 billion in cuts promised by the bill passed by the Republican-led House, which included such provisions as one that would curb the ability of states to waive employment requirements for unemployed “able-bodied adults” to collect food stamps.

Instead, farm bill negotiators settled on restricting food stamp cuts to a provision that would require households in some states to show federal heating assistance of at least $20 in order to get increased food stamps. Currently, 17 states allow households to qualify for additional benefits if they receive any kind of federal assistance — even as low as $1 — from the Low Income Home Energy Assistance Program.

A compromise approach for dairy

Dairy farmers were not as pleased with the farm bill as row-crop farmers, but they can live with a compromise worked out in the final days of negotiation, according to the National Milk Producers Federation.

Dairy farmers had stood adamantly in favor of the Dairy Market Stabilization Program — a provision in only the Senate farm bill — but relented after Boehner called it a “Soviet-style” program and demanded it not be in the farm bill.

“Despite its limitations, we believe the revised program will help address the volatility in farmers’ milk prices, as well as feed costs, and provide appropriate signals to help address supply and demand,” said Jim Mulhern, president and CEO of the group.

Original COOL provision maintained

The meat and poultry industry had hoped to use the farm bill as a vehicle for killing, or at least weakening, enforcement of country-of-origin labeling rules. Packers, who lobbied aggressively for repealing the 2002 labeling law, repeatedly pointed to the economic burden on processors and the potential to spark a trade war with Canada and Mexico.

But in the end, they lost the fight. The unified bill does not call for a repeal, though it does ask USDA to conduct an economic analysis of the labeling rule within 180 days.

Six of the most powerful meat and poultry groups — including the American Meat Institute, National Chicken Council and National Pork Producers Council — wrote to farm bill conferees hours before the final language was released, warning them that they will “actively oppose” final passage of the farm bill if it fails to include a resolution on COOL.

King and catfish amendments left out

Other controversial provisions have been left out of the farm bill, too, including an amendment sponsored by King that would have prohibited states from regulating other states’ means of agricultural production. It faced strong opposition from groups like the Humane Society of the United States and several lawmakers who said it would nullify state food safety and animal welfare laws.

Also not included in the conference report is a provision that would have reversed the move of catfish inspections out of the Food and Drug Administration and into the Agriculture Department’s Food Safety and Inspection Service. Cochran had made it his personal mission to eliminate that provision, which was contained in the House bill but not the Senate bill, on behalf of the many domestic catfish producers in his state.

After more than $30 million in startup expenses, the USDA has yet to inspect a single catfish — and has actually disbanded the four-member catfish inspection program it created, proponents of the change had argued.

Crop insurance program for organic industry

The organic industry has a lot to like about the new farm bill, including new crop insurance provisions, a cost-share measure for farmers transitioning to organic agriculture, and money for research, technological upgrades and market reporting.

“It looks like it fully funds the majority of our members priorities,” Steve Etka, legislative director of the National Organic Coalition, said in an email, though he added that he hadn’t yet finished looking through the conference report at the time. “So it’s looking good.”

Under the bill, by no later than 2015, organic producers will be able to insure their crops through the Federal Crop Insurance Agency at prices in line with their retail value. Currently organic crops are insured at premiums set for their conventional counterparts, meaning that farmers take a loss in the case of a crop failure or other problem.

Watered-down Benishek amendment remains

A weakened amendment by Rep. Dan Benishek (R-Mich.) that asks for more scientific and economic analysis of the Food Safety Modernization Act’s produce-safety rule remains, despite the urging of consumer and public health groups to reject it.

Benishek, whose district includes major tree-fruit growers not pleased about certain provisions of the proposed rule, would have prohibited FDA from enforcing any FSMA regulations until the agency published additional scientific and economic analyses in the Federal Register.

Jenny Hopkinson and Helena Bottemiller Evich contributed to this report.